Eminent Domain used against firearm patents?


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lbmii
June 30, 2005, 12:43 AM
Eminent Domain used against firearm patents?

Eminent Domain has traditionally been applied towards property in the form of land and dwellings. Is it not possible and logical that eminent domain can apply to other forms of property? Is not intellectual property just as tangible as any other form of property?

Could one reason that a government could make a case that it would make good economic and societal sense if a piece of intellectual property say a patent or a copyright owned by one would be better owned by another or by the State itself? Of course there would have to be “fair-market” compensation for the intellectual property.

Let us say that the State determines that the patents for various types of firearm mechanisms are found to be economically costly to the State because these firearm mechanisms are used to cause injury and thus medical costs. Could the State use eminent domain in the name of economics to acquire firearm patents? Could the State acquire copyrighted material that the State finds economically destructive?

Could not a large company approach the State to use eminent domain to acquire patents from a smaller company or individual with the argument that the larger company can get much greater economic use and create more jobs and tax revenue from the patents than the smaller company can?

Property is property. Is it not?

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Headless Thompson Gunner
June 30, 2005, 12:48 AM
If they limit themselves to the plain meaning of the law, then the answer is NO. Traditionally eminent domain powers extend only to the traking of real property (land) for the public use.

Sadly, they seem to be rewriting the rules as they go. So who knows? In the end they will probably take whatever they want, whenenever they want. :(

Standing Wolf
June 30, 2005, 12:59 AM
Property is property. Is it not?

Yep. It's all susceptible to thieves, some of whom have long felony records, some of whom have law degrees.

If they limit themselves to the plain meaning of the law, then the answer is NO.

Might rain shiny bright new dimes later this evening, too.

Flyboy
June 30, 2005, 01:35 AM
Actually, since the authority over the patent system is specifically provided to Congress by the Constitution, it would probably be constitutional for them to make a change to the system that would allow them to take those patents without a court case.

Wouldn't be right, but it would probably be within the strict letter of the Constitution.



On a related note, what the hell is wrong with this country when we're looking at the Constitution as a way for politicians to take our freedoms, property, and rights?

c_yeager
June 30, 2005, 06:04 AM
The prospect of profiting from ones development is the sole reason why we have innovation at all in the firearms field. The government is aware of this and has deep enough pockets that it simply wouldnt be worth it NOT to pay for inventions as they do today. Its not that the government is above outright thievery, its just that they realize that the costs would outweigh the benefit.

Henry Bowman
June 30, 2005, 09:33 AM
Speaking as a patent attorney...

ED has been used by the government with respect to patents in the past. Thus far, it has always been done in the name of national security -- when the patent owner did not have the manufacturing capacity to meet the government (military) needs. In these cases, which amount to a "compulsory license" which is common in many other countries, the Court of Claims will determine what is "just compensation" if a license royalty cannot be negotiated. In some cases, especially during a time of war, some patent owners have waived their patent rights in the public interest.

The other thing that can happen is a "secrecy order" could be issued. All patent applications that are filed are reviewed by the Defense Dept. Of course, some are reviewd more closely than others. if the disclosure of the content of the application would jeopardize national security, a secrecy order is issued and the patent application will never be published or examined until the Defenses Depart. releases it (which they sometimes do). For example, I have filed patent applications for Boing that relate to radar-adsorbing materials for stealth aircraft. A secrecy order was issued and I, the person who wrote the application discosure in the first place, was ordered to turn over the files to in house counsel who had security clearance (I don't recall what level) and was no longer allowed to have access to it. If the invention was "classified," then Boing would never get a patent on it, but may have some basis for "sole source" status if the invention was ever used for the .gov.

What you are describing is different -- the taking of the right to exclude others from making, using, selling, or importing (what patent rights are) even to the exclusion of the inventor/patent owner, for the "benefit" of the public. In practice, under that legal theory, then the .gov would have to sue infringers on the basis of the patent rights. That has never been done. The current state of the law is that patents and copyrights held by the .gov are in the public domain.

And yes, the constuction of the patent and copyright laws is totally up to Congress and the SCOTUS would probably uphold almost anything they did to them.

richyoung
June 30, 2005, 09:48 AM
...already happened. Both sides in WWII were using Bofors and Orlikon AA guns..not everyone paid royalties. Also study what happened to the inventor of the "Davis" laminar flow airfoil when they started cranking out B-24s by the thousands.

Old Fuff
June 30, 2005, 10:01 AM
During the early 1870's Colt was in serious trouble. They're arch-rival, Smith & Wesson, had a license to use the Rollin White patent that provided for a bored-through chamber that was necessary to use then new metallic cartridges. When S&W tried to extend the life of the patent, Colt went to President Grant and told him that the Colt Armory, supposedly so necessary to national defense, might close if the patent was extended.

Gant then vetoed the extension bill, which had been passed by Congress.

Not exactly the same thing as envisioned by this thread, but yes - the government can get rid of or take over patents when they want to.

Where there is a will, they're is a way ... :banghead:

MechAg94
June 30, 2005, 10:43 AM
Okay, why was Congress passing a patent extension bill to help S&W in the first place?

Old Fuff
June 30, 2005, 10:50 AM
Good question. Apparently at the time this sort of thing was routine, and S&W wasn't being given special or unusual treatment. I suspect that they requested some help from one of the senators and representives from MA., they dropped a bill into the hopper, and it went through without being challenged.

MechAg94
June 30, 2005, 11:12 AM
Okay, so I don't really see that Colt was granted favors so much as they stopped S&W from getting favors. :) I guess it all depends. I would think something like that could get a congressman in hot water these days.

MechAg94
June 30, 2005, 11:18 AM
It is funny sometimes to reflect on a lot of the big business corruption that went on back the latter half of the 1800's and imagine what people would say if that was going on today. Some of it was much worse. The only difference I can see is that there was no income tax and the amount of money and scope of it was often smaller. Now days we have big govt bueauracracies to do all that stuff and say they are just following procedures. Much more modern and efficient. :D

MechAg94
June 30, 2005, 11:19 AM
Sounds like what we need is a Teddy Roosevelt VP to come out of the woodwork and upset the govt applecart again.

Henry Bowman
June 30, 2005, 11:43 AM
What Old Fuff stated is correct. Still possible, but rare. A couple of decades ago, pharmaceutical patents would often be extended by an Act of Congress to compensate for all the time lost in FDA approval. was not always does fairly or objectively, so now the law has changed to make it statutory and automatic in cases that objectively qualify.

geekWithA.45
June 30, 2005, 04:09 PM
To be patentable, inventions are supposed to be useful, novel, without precedent in prior art, and non obvious.

The patent office has been issuing overly broad patents for too long without regard to prior art, or reference to how obvious the solution is.

Both individual inventors and companies have been using these overly broad, dubious patents to conduct scattershot campaigns of royalty collection, just to see who'll buy them off so they'll go away.

On the other hand, it's also well known and understood that even if you have a legitimate patent on bona fide novel technology, it will not be enforced if it's too useful.

The result is that the integrity of the system is shot to heck, and everyone knows it.



Some examples:

-The guy who invented the underlying IP of the MRI basically got shafted.

-I know the guy who was issued the patent on the following business process:

a) sit down with the client to determine what they want
b) create a written proposal to do what they want, including such documentation and diagrams as are necessary to clarify the deliverable product.
c) sit down with the client to gain approval for the proposal
d) deliver the agreed upon product
e) collect payment.

I'm totally serious. He filed the patent without any intention of enforcing it, he simply wanted to show how preposterous the whole thing is.


The integrity of the patent system is shot, and there's no real way to fix it short of auditing the tree from the root outwards, determining which patents are valid or not.

Even admitting that it's badly broken is likely to have economic repercussions.

Jeeper
June 30, 2005, 05:42 PM
and there's no real way to fix it short of auditing the tree from the root outwards, determining which patents are valid or not.

The number of patents that goes through the office is enormous. There is actually no way to know if something has already been invented. The rules that regulate whether something is new technology allows a lot of information to be available to disqualify it. There is no way a patent examiner at the USPTO could go through everything out there to determine if the technology was new. It would take months per patent. They have about a day. Litigation takes care of the rest. That is the only place where there is enough money at stake to do proper research. Unforunately with the number of patents now being issued, their complexity, and the amount of info out there this is the only model that currently works.

As to the eminent domain issue it was answered already. It is also in the code that a manufacturer acting on government orders cant be sued if the gov is having them make a patented device.

Langenator
June 30, 2005, 08:15 PM
If the .gov was going to use eminent domain to seize a patent for the "public good," the first place I could see them doing it is with prescription meds, due to the high cost of such meds for government health care programs.

Of course, such an act would destroy the pharmecutical industry, but governments don't usually think that far ahead.

AZRickD
June 30, 2005, 09:09 PM
Lang, you beat me to it. So I'll go to Argument B.
The prospect of profiting from ones development is the sole reason why we have innovation at all in the firearms field.
The same situation applies to real estate investment and development, or just plain home ownership. Wonder how that market will be affected if this becomes common place? Before, an home buyer could look forward to saying "after I pay off the bank, it's all mine." Eventually, he (we) might have to calculate in the risk of E.D. when purchasing prime real estate (or just a brake shop in Mesa, Arizona).

Our rights are no longer to be protected by the USSC. Basic Property Rights may now be threatened, without redress, by simple legislative action. "Just compensation?" You'll be lucky to get dimes on the dollar.

It's broken, folks.

Rick

landon74
June 30, 2005, 10:23 PM
Didn't something similar to this happen to Willys Overland during WWII? They designed the jeep, but GM ended up with the govt contract to produce Willys design?

Headless Thompson Gunner
July 1, 2005, 02:33 PM
Speaking as a patent attorney...

ED has been used by the government with respect to patents in the past. Are you sure the patent rights were taken through Eminent Domain powers and not some other area of law? I ask because the ED professionals I work with insist that ED applies only to land and land improvements.

Ultimately it doesn't matter what law they apply when they take your (property) rights. The end results are always the same. But I'm curious, so I ask....

Henry Bowman
July 1, 2005, 02:46 PM
I can't site to particular cases. I doubt that they were ever litigated to be reported. Logically, ED is not limited to real property. It would apply to any unique (not fungible) property, whether personal or real.

As others have said, if the .gov needs to use a product or process and the patent owner cannot meet the demand, they can place orders from others sources who are shielded from infringement liability. That is a "taking" of the patent owner's right to exclude and must be compensated. Since the patent owner could not meet the demand, he would not be entitled to lost profits, only a "reasonable royalty." If the royalty cannot be negotiated, it is litigated in the Court of Claims. Appeal would be to the Federal Circuit.

If I have some spare time, I'll search Court of Claims cases and see if I can find a good example.

Jeeper
July 1, 2005, 05:10 PM
Henry

As a recent law grad and patent agent I'll give you a case and statute. (My patent litigation book was sitting next to me)

28 USC 1498
The relevant part of the statute is:

(a)Whenever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same, the owner's remedy shall be by action against the United States in the United States Claims Court for the recovery of his reasonable and entire compensation for such use and manufacture.

A case that talked about it was TVI Energy Corp. v. Blane 806 F.2d 1057

Henry Bowman
July 1, 2005, 05:14 PM
Muchas gracias, Jeeper. :D

KriegHund
July 1, 2005, 05:17 PM
Hasnt such a thing been done already? So as to limit monopolization of a certain valuable (to the economy) item? Thorughout the 19 and 20th centurys?

The Govt reimbursed the patent holder, but still.

Sindawe
July 2, 2005, 02:42 AM
If the .gov was going to use eminent domain to seize a patent for the "public good," the first place I could see them doing it is with prescription meds, due to the high cost of such meds for government health care programs. Well golly-gee, take a look at this.

==========
Council to weigh Rx legislation
Neil Adler
Staff Reporter

After a weekend of fireworks, there could be more of the same next week in the District.

A controversial bill that would prohibit excessive pricing of prescription drugs by their manufacturers comes before the D.C. Council July 6.

In early May, the 13-member council gave its initial approval to the legislation, introduced by Councilman David Catania, I-at large, who chairs the council's health committee. A final reading and vote on the bill, the Prescription Drug Compulsory Manufacture License Act of 2005, is scheduled for this coming Wednesday.

Industry observers expect the council to approve the bill, despite warnings of lawsuits from big pharmaceutical companies.

Catania has told Washington Business Journal that he expects and welcomes legal recourse from the pharmaceutical industry. The bottom line for him is that drug companies record huge profits and continue to raise their prices, while many consumers have to decide whether to get the prescription drugs they need or buy food and pay rent.

Catania introduced his legislation in February and amended it a month later. At first he wanted to use the city's power of eminent domain to force drug makers to lower their prices. His new version of the bill says that if drugs are found to be excessively priced, the mayor may request a compulsory license that would, in essence, allow the city to take patents from brand-name drug makers and reissue them to generic manufacturers that could produce cheaper drugs for the District.

Catania and others believe the legislation could save the city millions of dollars on its health care tab. Currently the District spends about $250 million annually on drugs for its employees as well as residents on government-sponsored medical assistance.

Generics typically are 60 to 80 percent cheaper than their brand-name rivals.

Drug companies say if this bill were to pass it could lead other states to attempt to do the same, and that would drag down profits of biotech and pharmaceutical companies that spend millions, even billions, to create medicines.


© 2005 American City Business Journals Inc.

Source: http://washington.bizjournals.com/washington/stories/2005/06/27/daily47.html

These thieves know no bounds, do they? :fire:

Old Fuff
July 2, 2005, 09:52 AM
Ya, lets see if our domestic Socialists (a.k.a. "Democrats") are willing to cut the cost of prescription drugs by taking over all of the research costs. They seem to think that new medicines come out of thin air.

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